The problem involves determining the percentage increase in sales required to maintain the same profit after a 12% reduction in the price of a product. The discussion centers around the relationship between price, revenue, and sales volume.
Participants have engaged in calculations and shared their reasoning regarding the necessary increase in sales to offset the price reduction. Some have proposed specific percentage values, while others seek confirmation of these calculations.
There is a focus on maintaining profit levels despite changes in pricing and sales volume. The discussion reflects on the implications of price changes on revenue without reaching a definitive conclusion on the final percentage increase needed.
That would be the revenue if the number of sales didn't change. The problem asks you to find the percent increase in sales that must occur so that the profit (really the revenue) will stay the same.chawki said:Homework Statement
The price of a product is reduced by 12%.
Homework Equations
By what percentage must the sales grow, if the profit should he the same ?
The Attempt at a Solution
let's assume the original price is P, and the number sold was x, then the original revenue is P*x.
reduction of 12% means that the new price is 0.88*P, Thus the new revenue is 0.88*P*x